The New Year celebrations in Sydney are usually highlighted in the news all over the rest of the world as they wait for their turn. This year, the Australian dollar is also a leader. AUD/USD ended 2017 on a strong note and the gains extend into the new year. The pair is challenging resistance at 0.7840.
What is behind the rise? The US dollar’s weakness is extending into 2018: the greenback is sliding across the board with no exceptions.
But the Aussie also enjoys its own driver, in its case, from China. The world’s No. 2 economy and Australia’s No. 1 trading partner may see stronger growth according to an independent measure of the manufacturing sector. The Caixin Manufacturing PMI advanced from 50.8 to 51.7 points, defying early estimates for a dip to 50.7 points.
0.7840 was a line of resistance in October 2017 and beforehand served as a stepping stone on the way up in July. Further resistance awaits at 0.7865 but the next significant cap is at 0.79. Even higher, the round number of 0.80 looms. The peak for 2017 was 0.8165.
Looking down, 0.7780 and 0.7730 are lines of support. Will the positive momentum continue?
More: AUD/USD Forecast Jan. 1-5 2018